When an animal or plant dies and is buried under the ground with the right conditions for thousands or even millions of years, it turns to stone. Later when we dig them back up, we call them a fossil. When something has been turned into a fossil it is fossilised.
People have found fossils of all sized creatures, from tiny sea snails, to frogs, right up to enormous dinosaurs. Most of the creatures that people find as fossils are extinct - you can no longer see a living animal of that kind.
The fossil in the picture is a trilobite.